Working Papers
-
Working Paper Series
An Economical Business-Cycle Model
Apr 2015
In recent decades, advanced economies have experienced low and stable inflation and long periods of liquidity trap. We construct an alternative business-cycle model capturing these two features by adding two assumptions to a money-in-the-utility-function model: the labor market is subject to matching frictions, and real wealth enters the utility function. These assumptions modify the two core equations of the standard New Keynesian model
-
Working Paper Series
Have Large Scale Asset Purchases Increased Bank Profits?
Apr 2015
This paper empirically examines the effects of the Federal Reserve’s Large Scale Asset Purchases (LSAP) on bank profits.
-
Working Paper Series
Change and Rationality in Macroeconomics and Finance Theory: A New Rational Expectations Hypothesis
Mar 2015
We call attention to the class of models that serve as the foundation for the rational expectations hypothesis (REH). Models in this class rule out completely any structural change that cannot be fully anticipated with a probabilistic or other quantitative rule. REH models are abstractions of rational decision-making, but only in a hypothetical world in which participants can fully anticipate when and how they might revise their understanding of the process driving outcomes.
-
Working Paper Series
Household Income, Demand, and Saving: Deriving Macro Data with Micro Data Concepts
Mar 2015
We develop adjustments to align the NIPA measures of key household flows with cash flow concepts that better reflect household budgets and demand.
-
Working Paper Series
New Evidence for the Present-Value Model of Stock Prices: Why the REH Version Failed Empirically
Feb 2015
Shiller (1981) and others have shown that the quantitative predictions of the REH present-value model are inconsistent with time-series data on stock prices and dividends. In this paper, we assess the empirical relevance of the model without explicitly representing how a rational market participant forecasts dividends and interest rates.
-
Working Paper Series
Labor in the Twenty-First Century: The Top 0.1% and the Disappearing Middle-Class
Jan 2015
The ongoing explosion of the incomes of the richest households and the erosion of middle-class employment opportunities for most of the rest have become integrally related in the now-normal operation of the U.S. economy.
-
Working Paper Series
Beyond Market Failures The Market Creating and Shaping Roles of State Investment Banks
Jan 2015
Recent work has highlighted the need for innovation investments to be understood through a mission oriented approach rather than a market failure one (Foray et al. 2012). However, this work has only focused on state agencies, such as DARPA, overlooking the role of public financial institutions such as state investment banks.
-
Working Paper Series
Intra-Financial Lending, Credit, and Capital Formation
Dec 2014
This paper examines the effects of intra-financial lending – claims between financial institutions – on aggregate investment and credit to the non-financial sector in the United States.
-
Working Paper Series
Skill Development and Sustainable Prosperity: Cumulative and Collective Careers versus Skill-Biased Technical Change
Dec 2014
There is widespread and growing concern about the availability of good jobs in the U.S. economy. Inequality has been growing for thirty years and is now at levels not seen since the 1920s. Stable and remunerative employment has become harder for U.S. workers to find.
-
Working Paper Series
Long-term trends in intra-financial sector lending in the U.S. 1950 - 2012
Nov 2014
This paper examines the evolution of intra-financial sector lending in the United States, 1950- 2012, presenting estimates constructed from the Federal Reserve’s Flow of Funds Accounts.
-
Working Paper Series
Inequality, the Great Recession, and Slow Recovery
Oct 2014
Rising inequality reduced income growth for the bottom 95 percent of the US personal income distribution beginning about 1980.
-
Working Paper Series
The Political Movement that Dared not Speak its own Name: The Neoliberal Thought Collective Under Erasure
Aug 2014
Why do so many people who should know better argue that Neoliberalism ‘does not exist’?
-
Working Paper Series
Who Invests in the High-Tech Knowledge Base?
May 2014
A nation must accumulate a high-tech knowledge base to prosper.
-
Working Paper Series
Wage Increases, Transfers, and the Socially Determined Income Distribution in the USA
Apr 2014
This paper is based on a social accounting matrix (SAM) which incorporates the size distribution of income based on data from the BEA national accounts, the widely discussed 2012 CBO distribution study, and BLS consumer surveys.
-
Working Paper Series
Three Measures of Environmental Inequality
Apr 2014
Using data on industrial air pollution exposure in the United States, we compute three measures of environmental inequality: the Gini coefficient of exposure, the ratio of median exposure of minorities to that of non-Hispanic whites, and the ratio of median exposure of poor households to that of nonpoor households.